Virginia Insurance Commissioner James M. Thomson of Alexandria, once one of the most powerful members of the General Assembly, was narrowly nominated by House and Senate Democrats today to fill a seat on the influential State Corporation Commission.

Thomson is expected to become the first Northern Virginian to serve on the three-member commission that is considered one of the most powerful state regulatory bodies in the nation.

It oversees a broad range of business practices in the state and decides utility rate cases worth billions of dollars.

Thomson still faces a formal vote by the full General Assembly, which is controlled by the Democrats.

Thomson, a former majority leader in line to be House speaker, saw his 22-year career in the House come to an end in 1977 when he lost a celebrated and bitter election campaign that became focused on his refusal to support the Equal Rights Amendment in the legislature.

Thomson won 47 to 45 today over former Democratic legislator Edward E. Lane of Richmond, a 1977 candidate for attorney general, after three other candidates were eliminated. Thomson and the four others lobbied the legislators for months before today's vote.

Outside of high judicial appointments, the SCC posts are considered some of the best patronage plums awarded by the assembly.

Thomson won strong support from Northern Virginia legislators for the $64,000-a-year post despite the ERA dispute, which also was a factor in his failure to win appointment to a circuit court judgeship in 1979.

"I think that's all ancient history," said Sen. Clive L. DuVal II (D-Fairfax), head of the Northern Virginia caucus and a leader in the fight to hold down utility rates. "I don't think that will affect his ability to rule on telephone rates."

Democratic Dels. Mary Marshall of Arlington and Marian Van Landingham of Alexandria also strongly supported Thomson for the job. "He's big. He's tough," said Marshall.

Both of the legislators said they expect that Thomson will have a strong voice on consumer issues. "He told me he would see that the SCC holds hearings in Northern Virginia," Van Landingham said. The SCC appointed Thomson insurance commissioner in 1981.

Thomson will fill a vacancy created by Commissioner Junie L. Bradshaw, who was elected to a second six-year term on the SCC last year but has decided to resign and enter private business.

The other candidates were Judge William R. Murphy of the Prince Edward County Circuit Court, who had the support of much of the House leadership; Prince William lawyer Daniel H. Borinsky, and SCC General Counsel Lewis S. Minter of Roanoke.